3athlon - #dnf is no option

Donnerstag, 27. August 2015

Transaction confirmed, Dalian Wanda Group acquires World TriathlonCorporation and Ironman for $650 million

As reported earlier, Tampa based World Triathlon Corporation, Inc. (WTC) confirmed acquisition by Dalian Wanda Group for $650 million from private equity company Providence Equity Partners (PEP) in August 2015. In this price tag, Ironman's debt of around $240 million isn't included. The consolidated price with pending assumed obligations is around the $890 million mark. [1, 2]

The 2015 acquisitions of Ironman and Infront Sports & Media properties have made Wanda Group one of the world’s largest and most comprehensive sports companies. Logo: Dalian Wanda Group

PEP bought Ironman for est. $85 million from former owner, Dr. James P. Gills in 2008. The Gills family paid $3 million to Valerie Silk in 1990. Business value increased around 764% since Providence invested in the company, valuation exploded around 21,666% from first transaction in 1990. PEP invested during their ownership around $216m into WTC, mostly for acquisitions of former independent franchisees with Ironman events around the globe. This would reduce the valuation to roughly 400%, exceeding PEP's minimum goal of 250%.

U.S. Navy Commander John Collins founded the race in 1978 to compare three already existing endurance races. Around 1979 Collins no longer wanted to direct the Ironman race and approached Nautilus Fitness Center owners Hank Grundman and Valerie Silk about taking over control of the race. Following personal circumstances in 1981 Silk received ownership of Ironman. [2]

Davis Noell, Managing Director at Providence Equity Partners, Andrew Messick, CEO of WTC comments on the deal, following lastest Dalian Wanda acquistions of Infront Sports & Media and Atletico Madrid. Surprisingly a Dalian Wanda Group spokesperson didn't released a statement in this press release:

Wanda Group Acquires IRONMAN for Equity Value Of $650 Million From Providence Equity Partners

Dalian Wanda Group Co., Ltd. (“Wanda Group”), one of the leading Chinese private conglomerates, has reached an agreement to acquire 100% of IRONMAN for an equity value of approximately $650 million from Providence Equity Partners. As part of the transaction, Wanda Group will work with the current lending group and assume IRONMAN’s existing indebtedness. The acquisition by Wanda Group heralds yet another landmark investment in the sports sector following Infront Sports & Media and Atletico Madrid.

“Wanda Group’s acquisition of IRONMAN marks another exciting chapter and opportunity for the future growth of IRONMAN after seven very successful years of ownership by Providence Equity Partners,” said Andrew Messick, Chief Executive Officer for IRONMAN. “Wanda Group is a global-minded organization that shares our desire for excellence and continued growth, particularly in Asia. We are delighted to be part of the Wanda Group family of companies and are excited about the future of IRONMAN as we continue to provide life changing race experiences for athletes of all levels from their first step to the finish line.”

The iconic IRONMAN brand is the largest participation sports platform in the world. Its flagship races are IRONMAN® triathlons, which consists of a 3.9km (2.4 mile) swim, 180km (112 mile) bike and 42km (26.2 mile) run, and IRONMAN® 70.3® triathlons, which consist of a 1.9km (1.2 mile) swim, 90km (56 mile) bike, and 21.1km (13.1 mile) run. From its beginnings on the shores of Waikiki Beach on the island of O’ahu in Hawaii in 1978, IRONMAN has organized, promoted, and licensed triathlon events for 37 years, and owns five exclusive triathlon brands, operating at least 250 events every year around the world.

IRONMAN is expected to generate $183 million in revenue in 2015 and has increased revenue at a CAGR of 21% over the past four years. Due to its unique business model and proprietary intellectual property, the company is expected to deliver strong continued growth going forward.

The 2015 acquisitions of IRONMAN and Infront Sports & Media properties have made Wanda Group one of the world’s largest and most comprehensive sports companies. With these new businesses, Wanda Group now has sports sales, media & marketing, and operational capabilities on six continents with strong positions in North America, Europe, China, South Africa, Australia and New Zealand.

Davis Noell, Managing Director at Providence Equity Partners said, “We have thoroughly enjoyed our partnership with IRONMAN over the past seven years and are pleased with the company’s growth and operational excellence under Andrew’s leadership. We have great respect for Wanda Group and its leading global sports platform and believe IRONMAN is well positioned to continue its success with their support.”

Upd.: According to Slowtwitch all top management staff members are required to stay at WTC a 5 year term. [7]

Dalian Wanda required key employees to agree to 5-year employment agreements as a condition of the deal, and the office is not moving from Tampa, Florida. It seems to want stability and continuity.

Samstag, 8. August 2015

Dalian Wanda Group in talks to acquire World Triathlon Corporation andIRONMAN triathlon for $850 million

According to South China Morning Post, Dalian Wanda Group, owned by China's richest man Wang Jianlin is in talks to acquire IRONMAN's parent company World Triathlon Corporation (WTC). An mass participation sports asset would follow other acquisitions in the sports and media segment. Switzerland based sports marketing firm Infront Sports & Media was bought for EUR 1.05 billion in February 2015. A group, that was interested in WTC itself, but walked away from a deal. [1]

Maybe Infront's parent company can close a deal, certainly on a much lower price, than introduced from South China Morning Post. Not very reasonable sounds the "very high" price tag of $850m, considering assumed obligations like the $220m loan (due 2021) to pay a dividend to it's current owner Providence Equity partners and a $20 revolver due 2019 on WTC's balance sheet. Rating agency Moody's Investors Service has assigned a B2 Corporate Family Rating (CFR) and B2-PD Probability of Default Rating (PDR) to World Triathlon Corporation ("WTC" or "the company") in 2014. [2]

South China Morning Post wasn't able to get a confirmation from any involved party, but several of our own insider sources confirmed the negotiations and a very specific time window to close the deal around 10th of August 2015:

Dalian Wanda outbid other potential buyers for Ironman and is now in negotiations to finalise a deal with its owner, private equity firm Providence Equity Partners, the person said this week. There is no certainty that Dalian Wanda will manage to finalise a deal, the person added.

The source asked not to be identified because the negotiations are confidential. A spokesman for Providence declined to comment, while representatives for Dalian Wanda and Ironman did not immediately respond to a request for comment.